The S&P 500 also hit an all-time high, rising 0.5% as the financials sector gained 0.8%. Energy stocks also advanced 1.1%. The Nasdaq Composite, meanwhile, advanced 0.6% to a record.

Gao Feng, a ministry spokesperson for China’s Commerce Ministry, said that both sides had agreed to simultaneously cancel some existing tariffs on one another’s goods, according to the country’s state broadcaster. The ministry spokesperson said that both sides were closer to a so-called “phase one” trade agreement following constructive negotiations over the past two weeks.

“This gets us closer to a phase one trade deal, which is more important psychologically than fundamentally,” said Art Hogan, chief market strategist at National Securities. “It’s not as though we’re removing all tariffs and the economic drags dissipate, but what does dissipate significantly is the uncertainty.”

Traders work on the floor at the New York Stock Exchange.

Brendan McDermid | Reuters

One important condition for a limited trade agreement, Feng insisted, was that the U.S. and China must remove the same amount of charges at the same time.

It comes after reports that a meeting between President Donald Trump and Chinese President Xi Jinping could be postponed until December — delaying a chance for the two leaders to sign an interim trade deal.

“The last 24 hours have seen a bit of whiplash in the U.S./China trade drama, as a potentially negative headline yesterday has been more than offset by a positive one this morning,” said Tom Essaye, founder of The Sevens Report, in a note to clients. But “it’s fair to say that at these levels, the market is already partially pricing in removal of the tariffs that were implemented on September 1.”

“That also means the risk is of disappointment is now real on an actual phase-one announcement, because if all we get is ‘what’s expected’ and we don’t see any existing tariff removal, we could easily see a sell-the-news reaction in stocks,” Essaye said.

Market participants had expected the two economic giants to sign a deal later this month, after both Washington and Beijing spoke of progress in talks late last week. The U.S. and China have imposed tariffs on billions of dollars’ worth of one another’s goods since the start of 2018, battering financial markets and souring business and consumer sentiment.

But the recent optimism around U.S.-China trade has helped stocks push to all-time highs recently. Over the past month, the S&P 500 is up more than 5%.

“We are seeing a nice follow-through on the back of the breakout, the most obvious one being the S&P 500 hitting all-time high,” said Katie Stockton, founder and managing partner at Fairlead Strategies. “The breakout is what helped the market sustain the positive momentum. The short-term overbought condition I think will give way to a little consolidation, but I’m not looking for significant pullback at least not in a couple of weeks.”

On the data front, the latest weekly jobless claims numbers came in at 211,000, down slightly from 218,000 in the previous week.

In corporate news, Booking Holdings, Disney and Activision Holdings are the companies set to report their latest quarterly figures after market close.

Qualcomm shares jumped more than 7% after reporting Wednesday quarterly results that topped analyst expectations. The company’s results were driven by strength in Qualcomm’s licensing business.

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